Mutual Fund parity in derivatives trading permitted with conditions, position limits and exchange monitoring required. Mutual Funds may trade in exchange traded derivatives on par with registered FIIs, with schemes treated as client sub-accounts and Mutual Funds as trading members. New schemes must disclose extent, manner and risks of derivatives participation in offer documents; existing schemes require unit-holder disclosure, majority consent and an exit option without exit load. Prescribed position limits apply to index and stock derivatives, additional notional hedging limits are linked to fund holdings, and scheme-wise limits and disclosures follow the FII sub-account regime. Stock exchanges will monitor scheme-wise limits and assign unique client codes.